What CMEPA means to Filipino savers, stockholders, and REIT investors
One of the hottest topics lately is the Capital Market Efficiency Promotion Act (CMEPA). There’s been fear‑mongering around it—claims that CMEPA will tax your savings, that it’s anti ‑poor, and that it discourages investing.
Let’s set the record straight: CMEPA isn’t here to take from you. It’s here to empower you, especially if you’re an investor. Here’s what every Filipino should know especially if you’re already investing or planning to invest in real estate through real estate investment trusts (REITs).
No, your bank savings are not getting a new tax
Your regular deposits—whether in savings accounts, payroll, digital banks, or e-wallets—are untouched.
The 20 percent interest income tax remains the same. Your principal remains untaxed. This means over 80 million savers, including depositors in short term and small time deposits, are not affected. If you’re saving money the traditional way, you’re safe.
What changed for long term deposits?
Before CMEPA, those who parked money in long term deposits (five years or more) enjoyed tax-free interest.
CMEPA removes that exemption. All deposit interest income—regardless of term—are now taxed 20 percent. This affects around 850,000 out of over 83 million depositors, or roughly 1.02 percent.
This isn’t a “new tax.” It’s the removal of a rare privilege that only a small portion enjoyed.
Lower transaction costs for stock market (including REIT) investors
Here’s where the gains kick in for direct market participants. Stock transaction tax drops to 0.1 percent from 0.6 percent. Documentary Stamp Tax (DST) on stock redemptions is also removed.
If you invested in REITs via the Philippine Stock Exchange, your buy-sell transactions just got cheaper.
Even better, this benefits 1.2 million direct retail investors; 4.2 million indirect investors via mutual funds, unit investment trust fund (UITFs), and VULs; and 75 million Filipinos with passive exposure to stocks through Pag-IBIG, SSS, and GSIS.
This is a real win for investors who value consistent income streams and dividend yields from REITs.
No more DST on mutual funds, UITFs
CMEPA now exempts mutual fund shares (issuance or redemption) and UITF issuances.
This is particularly relevant if you plan to invest in REIT feeder funds or fund-of-funds via FirstMetroSec’s FundsMart, particularly those that allow dollar-denominated exposure to global REITs (think United States, Singapore, and European real estate markets).
Corporate tax reforms = more growth, more real estate activity
CMEPA also cuts taxes for companies raising funds.
This enables more real estate developers, REIT sponsors, and infrastructure firms to raise capital—translating to more commercial spaces, more expansion, and more dividend-generating assets. It has a strong multiplier effect, from corporate finance to everyday investor returns.
Stronger PERA incentives for retirement planners
If you have a personal equity and retirement account (PERA) or plan to open one, employer contributions now enjoy a 50 percent additional tax deduction.
Here’s a potential effect: From 7,000 current PERA holders to over 100,000 active retirement savers in just a year.
Many PERA funds also include REITs and real estate exposure, making retirement portfolios more diversified and robust, all while supporting the growth of the property sector.
Excise tax reinstated on luxury pickup trucks
CMEPA reintroduces a 20 percent excise tax on pickups priced above P1 million but below P4 million.
While this will affect some 50,000 new pickup buyers annually, it won’t have any impact on second hand and existing units.
This provision aims to plug tax leakages, fund infrastructure and social programs, and create fiscal space for capital market incentives.
Outdated tax breaks for some GOCCs removed
Twenty five legacy laws giving tax perks to select government-owned and -controlled corporations (GOCCs) are now repealed. This creates a level playing field and fairer tax policy across all sectors.
Impact on economy, investor
According to the Department of Finance (DOF) and National Economic and Development Authority (NEDA), CMEPA could boost gross domestic product by 0.2 percent to 0.4 percent annually.
It’s a modernization blueprint. It makes Philippine capital markets more efficient, inclusive, and aligned with global best practices.
Whether you are saving for your future, buying REIT shares, allocating part of your retirement to global REIT feeders via FundsMart, or investing in mutual funds or UITFs with property exposure, CMEPA is on your side.
Essentially, CMEPA means uniform taxation for depositors; lower investing costs for REITs and stocks; smarter retirement options; stronger investor protection; and simplified rules across the board.
CMEPA isn’t the villain—it’s the upgrade we Filipinos need and deserve.
The author, CIS, CSR, CTP, CUSP and CFMP, has 20 years of experience as an entrepreneur, real estate investor, stock broker, financial literacy advocate, a multi-awarded and sought-after investment educator and public speaker. He is the vice president and head of Business Development and Market Education Departments together with the OFW Desk of First Metro Securities Brokerage Corp., a member of Metrobank’s Financial Education Editorial Advisory Board, and the host of ‘Wais By Choice’ Podcast on Spotify and YouTube. Email him at andoybeltran@gmail.com
